So we know that banks (in the US and a lot of other countries) have a reserve requirement of 10% which means there's at most 10x more "air money" than there are real money in circulation, and that modern economies of debt are heavily reliant on the liquidity from this mechanism.
Now that we're seeing one of the biggest investment sprees in history, i.e. people are throwing their life savings into stocks, crypto, etc. instead of keeping it in the bank's shitty negative interest rate savings accounts, does this mean that the contraction of monetary circulation, and more importantly the contraction of the assets of the bank is 10x the rate at which people take money out of the bank?
If so what would be the effect of this?
Can this cause an unintentional bankrun?
Would this somewhat negate inflation caused by the federal reserve's inflationary policies?
Now that we're seeing one of the biggest investment sprees in history, i.e. people are throwing their life savings into stocks, crypto, etc. instead of keeping it in the bank's shitty negative interest rate savings accounts, does this mean that the contraction of monetary circulation, and more importantly the contraction of the assets of the bank is 10x the rate at which people take money out of the bank?
If so what would be the effect of this?
Can this cause an unintentional bankrun?
Would this somewhat negate inflation caused by the federal reserve's inflationary policies?
